Why the Best Time to Plan Is Before You Need It

Whether your concern is the cost of care, protecting your family, or preserving your independence, one fact stays constant: long-term care planning works best while you still hold the greatest number of choices. Two of the things a plan depends on — price and insurability — are set by your age and your health on the day you apply, and neither one moves in your favor by waiting.

This page sets out the landscape as it actually stands today, the four facts that drive the decision, the order in which the questions should be answered, and the window in which most families have the widest set of options. It is a planning page, not a product page. The funding question comes last here, as it should.

Sources: HHS Office of the Assistant Secretary for Planning and Evaluation, Long-Term Services and Supports for Older Americans (Johnson & Dey, revised 2022) and ASPE issue brief, January 2025; CareScout 2025 Cost of Care Survey, California statewide medians.

The Landscape, as It Actually Stands

Two things have changed in the last few years, and a good deal of what is still circulating about both of them is out of date.

Washington State now has a public program that pays benefits. WA Cares is funded by a payroll deduction on Washington workers and began paying claims on July 1, 2026, with a lifetime maximum of $36,500, indexed for inflation. Measured against a California private nursing home room, that maximum covers roughly two months of care. It is a floor, not a plan.

California has no such program. The California Long Term Care Insurance Task Force created under AB 567 delivered its actuarial report in December 2023, held its final meeting that same month, and was repealed by its own statute, SB 1255, effective July 1, 2024. There is no California program, no payroll tax, and no enrollment deadline of any kind.

Continue: State Long-Term Care Programs sets out what Washington actually pays, where the other states stand, and the full California record.

Four Facts That Drive the Decision

These are the numbers that decide how much coverage a household needs — and whether it needs any. Each is stated on its published source, and each has been corrected against the current data.

Why the Probability Figure Moved

The 70% figure that appears across this industry traces to a 2019 federal analysis that looked backward at people who had already died and counted every kind of severe need, including care provided unpaid by family. The current federal projection, for the cohort turning 65 between 2021 and 2025, is 56.4% — and it is measured at the threshold that actually pays an insurance claim: needing help with at least two activities of daily living for ninety days or more, or severe cognitive impairment. Both figures are honest. The lower one is the one to plan against, because it is the one a policy responds to.

The Tax Cost of Self-Funding — the Number Most Families Never Run

This is the fact that a CPA sees and an insurance agent generally does not. If the plan is to pay for care out of an IRA, a 401(k), or any other pre-tax account, the money has to come out and be taxed before a single hour of care is paid for. The cost of care is not the number that matters. The gross withdrawal required to produce it is.

Illustrative only. Assumes the withdrawal is fully taxable and does not itself push the household into a higher bracket. California's 13.3% rate applies only above $1 million of taxable income. Figures do not reflect the itemized medical expense deduction, which can offset part of the cost where qualifying expenses exceed 7.5% of adjusted gross income — see Tax Advantages.

So the old planning shorthand — that self-insuring costs twice as much in a high bracket — is true, but only at the very top. At the combined marginal rate most retired California households actually face, it is closer to half again as much. Either way, the point holds and it is rarely priced into the decision: a household funding care from pre-tax accounts is not exposed to $182,135 a year. It is exposed to something between $273,000 and $366,000 a year of portfolio withdrawals, in a year when the portfolio may also be down. Assets held in a taxable account carry a capital gains cost instead; a Roth carries none. Which account pays the bill changes the arithmetic more than most families expect.

Why Waiting Costs More

Of all the financial decisions people postpone, long-term care planning is among the most costly to delay. Unlike retirement saving, where a late start can be partly offset by contributing more, the consequences of waiting here compound in two directions at once — and one of them can become permanent.

The best time to plan was years ago. The next best time is today.

The pattern matters more than any single number. The same coverage bought at 65 rather than 55 commonly costs materially more every year for the life of the policy, and roughly one applicant in four is already being declined by their sixties. By the seventies it is closer to one in two. Cost is the visible penalty for waiting. Insurability is the one that cannot be undone — and it is worth knowing that a formal application that ends in a decline becomes part of your record and follows you to the next carrier. A preliminary underwriting review does not.

Continue: The Cost of Waiting on Long-Term Care Insurance sets out the age-banded premium tables, what waiting does to the size of the benefit pool, and the decline rates in full.

“We Can Afford It”

Many successful families tell me the same thing: we can afford long-term care. Perhaps. But writing a check is not the same as having a plan. A care event does not arrive as an invoice. It arrives as a decision — and the decisions come faster than most families expect.

Money pays the bill. Planning protects the family.

Continue: When “We Can Afford It” Isn’t the Right Answer works through the capital question in full — what self-funding actually requires, and when it is the correct decision.

Plan Before the Product

Long-term care planning is often mistaken for nursing-home planning. It is not. It is about preserving comfort, independence, and choice for as long as those are possible. A facility is the last step, not the goal — and there is a great deal of life between remaining at home and that last step. Before any funding question is worth asking, every plan should answer three things, in this order:

Only after those questions are answered should insurance be discussed.

The Planning Sequence

Once the first three questions are settled, the funding decision has its own order. Each step answers one question and narrows the next. Skipping to the last step is how households end up with a product that does not fit the plan.

Why Many Affluent Families Still Insure

Not every family needs insurance to fund care. But families who could comfortably write the check often still choose to insure the risk, for reasons that have little to do with affordability:

• Preserve investment assets, rather than liquidating them on someone else’s timetable.
• Protect family relationships, by settling in advance the decisions that otherwise strain them.
• Maintain independence, by funding care in the setting you would choose.
• Transfer much of the financial risk to an insurer instead of carrying all of it personally.
• Leave a generally income-tax-free death benefit if care is never needed, where the policy design provides one.

Properly structured, a plan of this kind is not simply an expense. It repositions capital you already hold — which is why an independent review is worth having even when the answer turns out to be that you do not need coverage at all.

The Ideal Time to Plan

Based on hundreds of client reviews, the most favorable planning window generally falls between ages 50 and 64.

The Decision That Matters

Long-term care planning is not about predicting whether you will need care. It is about preserving your independence, protecting your family, and retaining choices while you still have them. Whether you ultimately insure the risk or choose another funding strategy, the most important decision is to create a plan before circumstances create one for you.